I would like to simulate an equity index, a risk free cash account and the yield curve for the purposes of valuing a guarantee on an insurance product that is being backed by both equities and cash.
What is the industry standard model for an option that depends on the payoff of many asset classes - such as equities and cash? Can this be simulated with MC simulation?
Lastly, a common approach in the actuarial literature seems to be to simulate under the real-world measure and then use a stochastic discount factor to get back to a risk neutral price. Has this been applied in any of the above methods?